May

18

The best brokerage houses

May 18, 2022 |

it was a time when the best brokerage houses of the 19th century hastened to get prices to their customers:

There were no tickers in those days. The quotations were circulated by men who got them from the brokers, wrote them down on pads and then went from office to office or from man to man with them. These men, who had the latest prices, were called pad shovers. They came up to you and shoved the pad with the quotations on it right under your nose, hence the appellative. They were the walking tickers. Rushing the pad, they used to call the process. It was not so quick as the ticker, but the brokers who furnished the quotations to the pad shovers were conscientious and careful, and nobody could or ever did question their honesty. The pad shovers were paid for their services by a commission on whatever business they took to the two-dollar brokers, from the offices of other brokers. They received one dollar per hundred shares; hence the term, split-commission broker. The Stock Exchange ruled against this kind of business eventually, and with the advent of the ticker the pad shover went the way of the fluid lamp and the stagecoach.

(from Edwin Lefevre)

The worst brokerage house today won't let you get current prices unless you pay $1000+ a year to the Exchange no matter how many times you're already paying for it. there were panic sin those days as in current. The best brokerage houses would carry their customers and allow them to be way below required margins on grounds that their customers were friends and would rise again. Some panics were the Northern Pacific where the stock rose from 40 to 2000 in one day, the start of the first world war and the 1907 "silent panic". The worst brokerage houses today will not give you the sweat off their testicles if you are under margin for a second.

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